Investors who take an interest in GBM Resources Limited (ASX:GBZ) should definitely note that the MD, CEO & Executive Director, Peter Rohner, recently paid AU$0.035 per share to buy AU$174k worth of the stock. We reckon that’s a good sign, especially since the purchase boosted their holding by 313%.
The Last 12 Months Of Insider Transactions At GBM Resources
Notably, that recent purchase by Peter Rohner is the biggest insider purchase of GBM Resources shares that we’ve seen in the last year. Even though the purchase was made at a significantly lower price than the recent price (AU$0.07), we still think insider buying is a positive. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn’t tell us much about what they think of current prices.
Peter Rohner bought a total of 5.03m shares over the year at an average price of AU$0.035. The chart below shows insider transactions (by individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
GBM Resources is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Insider Ownership of GBM Resources
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. GBM Resources insiders own about AU$4.6m worth of shares. That equates to 34% of the company. While this is a strong but not outstanding level of insider ownership, it’s enough to indicate some alignment between management and smaller shareholders.
So What Does This Data Suggest About GBM Resources Insiders?
It is good to see the recent insider purchase. And the longer term insider transactions also give us confidence. However, we note that the company didn’t make a profit over the last twelve months, which makes us cautious. When combined with notable insider ownership, these factors suggest GBM Resources insiders are well aligned, and that they may think the share price is too low. I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph.
Of course GBM Resources may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions, but not derivative transactions.
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